Yanlord reports 2Q19 net profit dropped 41 percent on lower deliveries

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Yanlord Land reported Tuesday its second quarter net profit dropped 41 percent on-year to 865.32 million yuan as the developer delivered a lower gross floor area of residential units to customers.

Revenue for the quarter ended 30 June declined 58 percent on-year to 4.09 billion yuan, the property developer said in a filing to SGX.

Selling expenses for the quarter rose 47 percent on-year to 98.56 million yuan on higher staff costs and advertising expenses, while administrative expenses increased 53 percent on-year to 232.91 million yuan on a net foreign exchange loss, depreciation and other costs, the filing said.

For the first half, Yanlord reported net profit fell 48 percent on-year to 1.19 billion yuan on revenue of 7.71 billion yuan, down 54 percent on-year.

More of Yanlord’s pre-sales are due to be recognized in the second half of the year, based on the delivery schedule, the developer said.

“Testament to the strong buyer support, the accumulated contracted pre-sales and subscription sales by the Group including its joint ventures and associates from the sale of properties for the first half of 2019 rose 77.9 percent to approximately 20.735 billion yuan,” Yanlord said.

In the outlook, Zhong Sheng Jian, Yanlord’s chairman and CEO, was upbeat.

“We are confident that progressive recognition of our pre-sold units in the subsequent quarters will serve to enhance our recognized revenue for financial year 2019,” Zhong said in the statement.

“While the weaker global economy coupled with austerity measures introduced by the PRC central government will continue to present near term challenges for the PRC real estate sector, we nonetheless remain confident about the long-term development of the sector which is underpinned by strong demand arising from rapid urbanisation,” he added.

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